Justia U.S. 2nd Circuit Court of Appeals Opinion Summaries

This appeal concerned tax deductions that Altria claimed in 1996 and 1997, and which the IRS disallowed. The claimed deductions resulted from Altria's participation in nine leveraged lease transactions with tax-indifferent entities. The jury found that Altria was not entitled to the claimed tax deductions. Applying the substance over form doctrine, the jury rejected Altria's contention that it retained a genuine ownership or leasehold interest in the assets and therefore was entitled to the tax deductions. The district court denied Altria's motion for judgment as a matter of law or for a new trial and entered judgment for the government. The court affirmed and held that Altria had not shown that the district court erred in instructing the jury regarding the substance over form doctrine.

The Seneca Nation of Indians ("Seneca Nation"), Unkechauge Indian Nation ("Unkechauge Nation"), St. Regis Mohawk Tribe ("Mohawk Tribe"), Cayuga Indian Nation of New York ("Cayuga Nation"), and Oneida Nation of New York ("Oneida Nation") (collectively, "plaintiffs") sought to enjoin amendments to New York's tax law which were designed to tax on-reservation cigarette sales to non-member purchasers. At issue was whether New York's amended tax law interfered with plaintiffs' tribal sovereignty and violated their immunity from state taxation. The court held that plaintiffs failed to demonstrate a likelihood of success on the merits of their claims that the precollection scheme impermissibly imposed a direct tax on tribal retailers, or alternatively, imposed an undue and unnecessary economic burden on tribal retailers; and that the coupon and prior approval systems interfered with their rights of self-government and rights to purchase cigarettes free from state taxation. Accordingly, the district court abused its discretion in granting the Oneida Nation's motion for preliminary injunction and correctly rejected the Seneca Nation's, Cayuga Nation's, Unkechauge Nation's, and Mohawk Tribe's motions for preliminary injunctions.